Scottsdale and Phoenix, Arizona Bankruptcy Attorney- Arizona Bankruptcy Article

Law Office Of

Joseph A. Velez

480.710.5079

Real Estate & Business Law Attorney

The Law Office of Joseph Velez

Commercial Real Estate & Business Law Attorney

Scottsdale Financial Center

7272 E. Indian School Rd., Suite 111

Scottsdale, Arizona 85251

480.710.5079

Are you drowning in debt and having trouble making your monthly payments? Out of necessity bankruptcy filings are becoming more and more common in the current economy. A lot more than just your money and assets are at stake when you are in a financial crisis. For those whose debts are beyond their means there is a solution than is becoming more and more popular: Bankruptcy.  According to a recent article in The Arizona Republic, bankruptcy filings are up 91% compared to 2008. There comes a time when severe debt, late fees, and penalties become unmanageable for any income. Those contemplating bankruptcy often endure harassing collection calls at the home and place of employment, wage and asset garnishment, as well as potential repossessions and foreclosure. The filing of a bankruptcy can stop all of these. Filing  bankruptcy allows you the opportunity to rebuild your financial situation.


There are two general types of personal bankruptcy that can be filed: A Chapter 7 liquidation or a Chapter 13 reorganization. 


A Chapter 7 bankruptcy allows the filer through a court order to eliminate certain unsecured debts, while other secured debts (a mortgage and/or automobile loan) continue to be repaid if the debtor wants to keep the secured property. For example, Tamika owes $75,000

on various credit cards bills, and several thousand in medical bills.  The cost of her recent divorce from Gustavo (who ran away to Argentina to “find himself,” but instead found another woman named Maria) together with her crushing credit card and medical debt have left her hopelessly behind on the bills with no chance of repayment. In this situation a Chapter 7 bankruptcy would provide forgiveness of Tamika’s unsecured credit card and medical bill debt. Technically, it could also eliminate her car and house loans, but since Tamika wants to keep them, she will need to continue to pay those bills to avoid losing them to repossession and foreclosure.

     A Chapter 13 bankruptcy is for those who intend to repay their debt but need immediate relief from collections, late payment penalties and interest. The repayment plan to your creditor is based on your income versus your expenses. The plan allows for a filer to make payments toward their debt. This repayment plan usually lasts up to 60 months.

     For homeowners, filing bankruptcy does not mean you will automatically lose your home. If you continue paying the home, you can keep it. However, because many have been left with homes worth less than the mortgage itself, giving the home up in a foreclosure may be the inevitable (and optimal) result. If your house is in foreclosure, filing bankruptcy will stop the foreclosure - at least temporarily (for few months).


Bankruptcy Process


Filing for bankruptcy is a legal process. For this reason, and for your own financial well-being, each decision that you make about bankruptcy should be well informed. Although it is possible to file bankruptcy on your own, it is a process that is strewn with minefields and plenty of ‘gotchas”. With so much at stake, it’s highly recommended that you work with an attorney who can guide you through the complicated process.  You will have to provide your lawyer with all your financial information in order to put together and file your bankruptcy petition. Once the documents are filed with the bankruptcy court, you will be assigned a trustee who will see to it that all the information that is needed is collected from you and that all the information you provided is accurate. The next step is that both your attorney and the court will notify your creditors that you have filed bankruptcy, which will then stop all collection calls to you. 


Life after Bankruptcy


Many people worry about the long term effects of filing for bankruptcy, however bankruptcy gives you the opportunity to rebuild your financial life. In the majority of cases, people are able to rebuild their credit in a matter of a few years if they are careful and diligent. Turning now to obtaining a mortgage after bankruptcy, it typically takes three (3) years after a bankruptcy to qualify for a new mortgage.

    Once thought of as taboo, filing for bankruptcy has become the solution to the overwhelming debt many people face. My office is dedicated to giving our clients realistic and straightforward advice that can help them through this very difficult and delicate process. Remember, we’re not here to judge, we’re here to help. Call me if you have any questions regarding filing for bankruptcy.

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Our law office represents clients throughout the Phoenix, Arizona area including the cities of Scottsdale, Maricopa, Mesa, Surprise, Paradise Valley, Avondale, Gilbert, Chandler, Glendale, Florence, New River, Fountain Hills, Peoria, Surprise, Queen Creek, Tempe, Sun City, Apache Junction, and Casa Grande. We serve the counties of Maricopa, Yavapai, Gila, Pinal, La Paz, Yuma, and Pima County.

DISCLAIMER: This site and any information contained herein are intended for informational purposes only and should not be construed as legal advice. Seek competent legal counsel for advice on any legal matter.

One hour initial office consultation fee is $295 for the matters discussed above.